MENHADEN RESOURCE EFFICIENCY PLC — Fund Information / Factsheet 2016

Oct 14, 2016

Menhaden Capital PLC

Frostrow

CAPITAL

Menhaden

Information as at 30 September 2016

www.menhaden.com

Investment Objective

Menhaden Capital PLC (the "Company") seeks to generate long-term shareholder returns, predominantly in the form of capital growth, by investing in businesses and opportunities, irrespective of their size, location or stage of development, delivering or benefiting from the efficient use of energy and resources. Whilst the intention is to pursue an active, non-benchmarked total return strategy, the Company will be cognisant of the positioning of its portfolio against the MSCI World Index (Total Return, Sterling adjusted).

10 Largest Holdings at 30 September 2016 (% of total assets)

Name		Total
X-ELIO *		14.1
Terraform Power		8.2
WHEB Ventures Private Equity Fund 2 LP^		5.6
Alpina Partners Fund LP^		4.8
Airbus		4.8
Volkswagen		4.4
Safran		4.0
Terraform Global		3.5
Atlantica Yield		3.3
FirstGroup		2.5
Total		55.2

^Investment made through Helios Co-Invest LP

^ managed by Alpina Partners

Commentary

During September the Company's NAV per share was up 1.2%, the share price was unchanged, while the MSCI World Index (total return, sterling adjusted) was up 1.4%.

During the third quarter the Company's NAV per share was up 6.2%, the share price decreased 6.5%, while the MSCI World Index (total return, sterling adjusted) increased 7.9%.

During the quarter after the Brexit vote we initiated two positions in the public equities segment. The first in FirstGroup, a UK public transit company with significant holdings in the US, and the second in a North American industrial gases business, Air Products & Chemicals.

Efficient mass transit, such as is provided by FirstGroup, is on the rise globally, as people increasingly opt out of car ownership. Emissions associated with such mass transit are dramatically lower than private alternatives.

Air Products supplies gases which help different industrial sectors to use energy and resources more efficiently, and with lower emissions. For example, added oxygen makes the steel manufacturing process cleaner (reduced fugitive emissions) and more efficient. And hydrogen is used to strip sulphur out of fossil fuels, reducing sulphur dioxide emissions. Products produced by Air Products mitigate much more carbon than is emitted during their production. This is therefore a carbon net negative business.

For some time, we have held the conviction that the market has been under valuing Terraform Power and Terraform Global, when considering the private market values and free cash flows of their assets; and we had added to both positions earlier in the year. The two Terraforms have been the main contributor to our positive performance during September and during the third quarter, when Terraform Power was up 27.6% and Terraform Global 26.1% (both in dollar terms). Our view remains that markets continue to undervalue these, and the other similar companies we hold, publicly traded portfolios of renewables assets in comparison to where such assets trade privately.

The largest detractors to the portfolio in Q3 were our private investments. In particular, the two funds run by Alpina Partners (formerly WHEB Partners). Following the mark-downs in the valuation of our holding in WHEB Ventures Private Equity Fund 2, the Alpina team completed the sale of Via Optronics and distributed the proceeds with a resultant reduction in the NAV of our holding. The portfolio now has less than two years to run.

Effective early October, we have decided to fully move the management of our public equities portfolio in-house, as such we have terminated the segregated mandate with our friends at WHEB Asset Management who managed a part of our listed portfolio.

Portfolio Manager Profile

Menhaden Capital PLC has appointed Frostrow Capital LLP as its Alternative Investment Fund Manager (AIFM). The portfolio management services for which the AIFM has overall responsibility are carried out by the Investment Committee, comprising Graham Thomas, Ben Goldsmith, Alexander Vavalidis and Luciano Suana from Menhaden Capital Management LLP ('Menhaden'), who have been seconded to the AIFM for the purpose of performing such activities.

Biographies

Graham Thomas is the non-executive chairman of the Investment Committee. Before co-founding Menhaden, Graham chaired RIT Capital Partners plc's Executive Committee, was a member of its investment committee and had direct responsibility for its private investments. Prior to this Graham was the head of the Standard Bank Group's US$3 billion Principal Investment Management division, which was established in 2008 under his leadership. Graham is currently a non-executive director of Tamar Energy and Lesmoir-Gordon, Boyle & Co, and is on the investment committee of Apis Partners, a private equity firm.

Ben Goldsmith is the Chief Executive Officer of Menhaden. Before co-founding Menhaden, Ben co-founded the WHEB group, one of Europe's leading energy and resource-focused fund investment businesses. Ben is a director of Cavamont Holdings, the Goldsmith family's investment holding vehicle and also chairs the UK Conservative Environment Network.

Alexander Vavalidis is an investment manager at Menhaden. Before co-founding Menhaden, Alexander worked at Manzanita Capital, a private equity firm founded by the Fisher family in London focusing on the prestige beauty industry. Before Manzanita Capital, Alexander worked in New York for the Financial Sponsors group at Credit Suisse and for the Illiquids Group at Dresdner Kleinwort in London.

Luciano Suana is an investment manager at Menhaden. Before joining Menhaden, Luciano was a Director for Barclays Capital in the Capital Markets division where he ran the credit trading operations for Brazil out of São Paulo. Before Barclays, Luciano was a Director at Dresdner Kleinwort in London. There he focused mainly on Infrastructure, Utilities and Real Estate assets as head of the Illiquids Credit group.

Investment Policy

The Company's investment objective is pursued through constructing a conviction-driven portfolio consisting primarily of direct listed and unlisted holdings across different asset classes and geographies. The Company invests, either directly or through external funds, in a portfolio that is comprised of three main allocations: listed equity; yield assets; and special situations. The flexibility to invest across asset classes affords the Company two main benefits: 1) It enables construction of a portfolio based on an assessment of market cycles; and 2) It enables investment in all opportunities which benefit from the investment theme. Once substantially invested, it is expected the portfolio will comprise approximately 20 to 25 positions. Typically, the portfolio will not comprise fewer than 20 positions or more than 50 positions. For these purposes, an investment in an external fund is treated as one position.

The portfolio will be predominantly focused on investments in developed markets, though if opportunities that present an attractive risk and reward profile are available in emerging markets then these may also be pursued. While many of the companies forming the portfolio will be headquartered in the UK, USA or Europe, it should be noted that many of those companies will be global in nature so their reporting currency may not reflect their actual geographic or currency exposures. Subject at all times to any applicable investment restrictions contained in the Listing Rules, the Company will not make an investment if it would cause a breach of any of the following limits at the point of investment: 1) no more than 20% of the Company's gross assets may be invested, directly or indirectly through external funds, in the securities of any single entity; and, 2) no more than 20% of the Company's gross assets may be invested in a single external fund.

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Menhaden Capital PLC conducts its affairs so that its shares can be recommended by independent financial advisers ("IFAs") to retail private investors. The shares are excluded from the Financial Conduct Authority's ("FCA's") restrictions which apply to non-mainstream investment products because they are shares in a UK-listed investment trust.

Menhaden Capital PLC

Asset Allocation Breakdown as at 30 September 2016 (%)

Asset	Total
Public equities	39.7
Private investments	24.6
Yield investments	16.8
Liquidity	18.9
Total	100.0

Source: All portfolio information sourced from Frostrow Capital LLP

Geographic Breakdown as at 30 September 2016 (%)

Asset	Total
US	31.6
Europe	29.0
Unquoted UK LPs	10.4
UK	3.8
Emerging Markets	3.5
Asia	2.8
Liquidity	18.9
Total	100.0

Source: All portfolio information sourced from Frostrow Capital LLP

Standardised Discrete Performance (%)

Percentage Growth	1 month	YTD	1 Year	Since Inception*
NAV	+1.2	+1.8	-4.0	-12.6
Share Price	0.0	-24.7	-42.4	-43.4
Index ^	+1.4	+19.8	+29.9	+20.3

Source: Morningstar.
* MSCI World Index (Total Return, Sterling adjusted). The Company pursues an active, non-benchmarked strategy but is cognisant of the positioning and returns of the its portfolio against the MSCI World Index.
*after IPO costs

Important Information

Menhaden Capital PLC (the "Company") is a UK investment trust listed on the London Stock Exchange. As this Company may implement a gearing policy, investors should be aware that the share price movement may be more volatile than movements in the price of underlying investments. Past performance is not a guide to future performance. The value of investments and the income from them may fall as well as rise and is not guaranteed. An investor may not get back the original amount invested. Changes in the rates of exchange between currencies may cause the value of investments to fluctuate. Fluctuation in the share price may be particularly marked and the value of an investment may fall suddenly and substantially. There can be no assurance that the Company's investment objective will be achieved and investment results may vary substantially over time. This document is for information purposes only and does not constitute an offer or invitation to purchase shares in the Company and has not been prepared in connection with any such offer or invitation. Investment trust share prices may not fully reflect underlying net asset values. There may be a difference between the prices at which you may purchase ("the offer price") or sell ("the bid price") a share on the stock market which is known as "bid-offer" or "dealing" spread. Net Asset Value per share is calculated in accordance with the guidelines of the Association of Investment Companies. Net assets are stated inclusive of income received. Any opinions on individual stocks are those of the Company's Investment Committee and no reliance should be given on any such views. The views expressed herein do not constitute investment or any other advice and are subject to change. They do not necessarily reflect the views of Frostrow Capital LLP and no assurances are made as to their accuracy.

www.menhaden.com

Fast Facts	As at 30 September 2016
Launch Date	31 July 2015
Annual Management Fee	(payable by the Company)
Portfolio Management Fee	1.25% p/a on first £150m of AUM, 1.0% thereafter; AIFM Fee 0.225% p/a up to £150m, 0.20% p/a thereafter up to £500m, 0.175% in excess of £500m.
Performance fee	See Prospectus for details
Ongoing charges*	2.1%
Continuation Vote	At AGM in 2020; every 5 years
Year / Half Year	December / June
Capital Structure	80,000,001 Ordinary Shares of 1p

Trust Characteristics

Number of Holdings	30
Total Net Assets (£m)	£68.3m
Market Capitalisation (£m)	£46.4m
Dividend Policy	Target 2% per annum dividend yield once the Company's assets are substantially invested
Gearing (AIC basis)	0%
Leverage Gross & Commitment	0%
Share Price (p)	58.00
NAV (p)	85.40
(Discount) / Premium	(32.1%)

Codes

Sedol	BZ0XWD0
ISIN	GB00BZ0XWD04
Bloomberg	MHN LN
Epic	MHN

*Calculated at the financial year-end, includes management fees and all other operating expenses.

How to Contact Us

Frostrow Capital LLP

25 Southampton Buildings, London, WC2A 1AL

Tel.: 0203 0084910

Fax: 0203 0438889

Website: www.frostrow.com

Grant Challis

Tel.: 0203 0084912

grant.challis@frostrow.com

David Harris

Tel.: 0203 4273835

david.harris@frostrow.com

This financial promotion is issued by Frostrow Capital LLP which is authorised and regulated by the Financial Conduct Authority ("FCA").

Frostrow CAPITAL